The business outlook of professional services in 2018

The business outlook of professional services in 2018

A country’s economic performance is service-based. In the most competitive countries in the European Union, the service economy claims leadership. The development of the services sector is also desirable for Romania if it wants to be a competitive economy. Therefore, the development of this sector is very important, whilst monitoring of its development is necessary and useful.

Public policies to support the development of this sector, technological developments, per capita income growth, changing purchasing behaviors and consumer experience requirements influence the growth of turnover, profit or investment in the services sector.

In Romania, the results of the survey Business outlook in Romania for 2018 for the second half of the year 2018 highlights the growth prospects of companies in the professional services sector by comparing the results with those of the research carried out in the first semester as follows:

  • Turnover – 25% of companies in the second half of 2018, compared with 26% in the first half, say turnover will increase by +10% – +30%, while 18% vs. 28% say they will have an increase of +5% – +10% and 17% vs. 12% over the range +1% – +5%. Thus, in the second half of 2018 there is a slowdown in growth compared to the first half, reinforced by the expectation of the 7% of companies that say that their turnover will stagnate this year and of the 32% who say it will fall in 2018, compared with only 9% earlier this year.
  • Profit – The same outlook is repeated on a larger scale in the case of profit forecasts for the professional services companies in the second half of 2018. The largest percentage drop of profit of from 34% in the first semester to 21% in the second semester is in the range between +1% – +5 %, followed by a fall from 24% to 18% over the +5% – +10% increase in profit. Exceptions to this negative growth trend are the companies that expect a profit is expected to increase between +10% – +20% from 14% in the first half of the year to 18% in the second. Moreover, 21% of the respondents say they expect a fall in profit in 2018 compared to 10% in the first six months.
  • Investments – Investments in the services sector are in line with the evolution of the turnover and the expected profit for the first half of 2018. In the range +10% – +20% we see the largest decrease in investments of 10pp (from 17% in the semester one percent to 7% in the second semester) and 8pp less companies that say their profit will increase by +1% – +5% this year (from 33% in H1 to 25% in H2). There is an increase in the percentage of companies stopping this year’s investment from 16% in the first half to 25% in the second half of the year.

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